Energy companies could beat Government price cap by shifting consumers onto green tariffs
ENERGY companies could try to beat the Government’s price cap by using a loophole to shift consumers onto potentially more expensive green energy tariffs, according to Ofgem.
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On Wednesday, the chief executive of the energy regulator, Dermot Nolan, will appear before the Business, Energy and Industrial Strategy Committee to explain how it will set the price cap and determine when the market is operating fairly again.
The draft legislation exempts green energy tariffs from the price cap.
The fear is that energy firms could shift disengaged consumers onto so-called “green tariffs” that only provide a “slight additional” environmental benefit, to beat the cap.
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An SVT or default tariff cap would not automatically result in people being moved onto a good deal, rather than just a capped tariff
Green energy group Bulb co-founder Hayden Wood said the committee should quiz Ofgem on whether green tariffs should be exempt from the cap.
He added: “We are concerned that the draft legislation could lead to millions of households missing out.”
GoCompare energy spokesman Anders Nielsen said: “An SVT or default tariff cap would not automatically result in people being moved onto a good deal, rather than just a capped tariff. There’s a chance people could mistake a price-capped tariff for being competitive.”
